The Russian National Wealth Fund, the country’s sovereign wealth fund, has enough reserves to cover the shortfall in income from falling oil prices between $25-$30 per barrel for six to 10 years, Russia's Ministry of Finance said in a statement on its website.
The statement comes as oil prices fell dramatically on Monday in the biggest one-day drop since 1991 with futures trading around 25 percent down at the opening bell.
“The outlook for oil is now extremely negative, given the slowdown globally caused by coronavirus and the collapse of the OPEC+ cartel. It is hard to see Brent crude recovering back above $40 a barrel in this environment,” said Jeffrey Halley, senior market analyst – Asia Pacific for OANDA, a forex trading platform.
Members of the Organization of Petroleum Exporting Countries (OPEC) and 10 other members, including Russia, previously known as the OPEC+ group, had met in Vienna over the weekend to discuss increasing an existing output cut agreement. Talks fell apart after Russia failed to agree to a proposed 1.5 million barrel per day cut increase.
The current deal will expire on April 1, at which point members of the OPEC+ will be allowed to increase their oil operations, a fact that has triggered markets to fall amid fears of a price war between oil producers.